Benchman Investments (Private) Limited v The Commissioner General, Zimbabwe Revenue Authority

On 18 June 2002, the applicant purchased 30 motor vehicles from Japan which were shipped to Durban and arrived on 29 July 2002. On 2 August 2002, the Minister of Finance published General Notice 359A of 2002 and Statutory Instrument 225 of 2002, designating a rate of Z$300.00 to US$1.00 as the selling rate for certain imported goods including motor vehicles for purposes of section 115 of the Customs and Excise Act. The vehicles were imported into Zimbabwe on 5 August 2002. When the applicant attempted to clear the vehicles, its agent was informed that their value would be assessed using the selling rate fixed by GN 359A of 2002, resulting in a huge and unexpected increase in customs duty payable. The applicant filed an urgent application challenging the validity of the increase, and the parties agreed to submit the matter as a stated case.

• Whether General Notice 359A of 2002 as read with SI 225 of 2002 validly fixed a selling rate for the purposes of section 115 of the Customs and Excise Act
• Whether GN 359A of 2002 was made in accordance with section 115 of the Act which requires the selling rate to be designated by the Commissioner/Director in consultation with the Reserve Bank
• Whether the Minister had the power to designate the selling rate under section 3(2) of the Exchange Control (Exchange Rate Management) Order 2001
• Whether the fixing of the selling rate was exercised reasonably or was grossly unreasonable

The court answered the stated question as follows: (1) General Notice 359A of 2002 as read with Statutory Instrument 225 of 2002 does not validly fix a selling rate for the purposes of section 115 of the Customs and Excise Act; (2) General Notice 359A of 2002 is invalid because it was not made in accordance with section 115 of the Act; (3) The respondent shall pay the costs of the application.

Where a statute confers a power on a specific official (in this case, the Commissioner/Director in consultation with the Reserve Bank), that power cannot be exercised by another authority (the Minister), even if that other authority purports to act under different legislation. An administrative act or notice that is made ultra vires (beyond the powers) of the issuing authority is invalid and of no legal effect. The designation of a selling rate under section 115 of the Customs and Excise Act must be made by the Commissioner in consultation with the Reserve Bank as expressly provided in the section, and any attempt by the Minister to designate such rate is invalid as it was not made in accordance with the statutory requirements.

The court noted in passing that section 3(2) of the Exchange Control (Exchange Rate Management) Order 2001, upon which the Minister purported to act, appeared to have been repealed by section 2 of the Exchange Control (Exchange Rate Management)(Amendment) Order 2001 (No. 1). The court also observed that the respondent's case could possibly have been bolstered through an examination of the interactions and apparently conflicting competencies of the relevant authorities under the Customs and Excise and the Exchange Control Acts, but this elementary step was not taken. The court commented that the failure to address these issues made the respondent's case extremely weak. The court also noted that it did not need to determine the issue of gross unreasonableness raised by the applicant, as the matter was decided on the basis of lack of statutory authority.

This case is significant in Zimbabwean administrative law as it reinforces the principle of statutory interpretation and adherence to legislative authority. It establishes that administrative authorities and Ministers must act strictly within the powers conferred upon them by statute and cannot usurp powers given to other designated officials. The case demonstrates judicial willingness to scrutinize administrative action and invalidate measures that exceed statutory authority, even in matters of fiscal policy and customs administration. It also highlights the importance of proper consultation procedures as required by legislation and the consequences of attempting to exercise powers through provisions that have been repealed.